November has kicked off quite well for investors. U.S. stocks saw their biggest one-day gains in more than two years on Thursday, following release of the Labor Department’s latest consumer-price index reading. The data showed inflation easing in October – with overall inflation at 7.7 percent, down from 8.2 percent in September – and raised hopes that the Fed will soon begin to slow its aggressive pace of interest rate hikes.
Markets may continue to bounce around as investors wait for more clear indications of our economic future. It is possible that we are seeing the beginning of a recovery, however, inflation is still very high. The early December Federal Reserve report will be very telling.
As you may have read, major U.S. stock indexes also posted gains in October, propelled by better-than-expected corporate earnings reports and some Federal Reserve officials signaling a willingness to slow the pace of monetary tightening. The Dow Jones Industrial Average led October, gaining 13.95 percent. The Standard & Poor’s 500 Index tacked on 7.99 percent, while the Nasdaq Composite added 3.90 percent for the month of October.
Corporate earnings are an important measure of market behaviors. Publicly traded companies report earnings each quarter, and this quarterly earnings season provided good results. Many investors were able to put aside worries about Fed policy and recession to focus on how companies fared financially. By the end of October, 263 of the 500 companies in the S&P 500 index reported earnings, and 73.4 percent of those earnings topped Wall Street analysts’ estimates – above the 66 percent long-term average. This is a positive sign, and another reason we are optimistic for stock investments over the next 8-12 months.
The advisors at Charter Oak continue to be active and vigilant while managing your investments. Sometimes that means holding the course when things are challenging, and sometimes that means making moves, even bold moves when necessary. At this juncture, we are favoring US-based stocks over non-US stocks as well as high quality bonds with 1-to-3-year maturity dates. Interest rates are now consistently over 4 percent annually, a rate we haven’t seen in decades – this is great for bond investors, but terrible for home buyers.
Tips for Medicare and ACA Open Enrollment
For many people, November is a time to think about enrolling in or updating health insurance coverage.
- For those who are already on Medicare, open enrollment runs from October 15 to December 7, and is a time when current Medicare beneficiaries can adjust their coverage for the coming year. Note: If you are not yet signed up for Medicare, your sign-up window runs the three months before and the three months after you turn 65. If you need help navigating the sign-up process a Charter Oak advisor will be happy to assist and clear up any confusion.
- For those who are pre-65 and not covered by an employer plan, open enrollment for 2023 Marketplace health insurance coverage began on November 1 and ends on January 15, 2023, but Wednesday, December 15 is the last day to enroll for coverage to begin on January 1, 2023.
In light of this timing, below are Charter Oak’s tips for choosing a health insurance plan– whether you are looking at Medicare coverage or through the Marketplace.
Tip #1: Assess Your Current Costs
When thinking about changing your health insurance plan, it’s important to review your healthcare-related expenses. Take a look at how much you are currently paying per month for your plan as well any out-of-pocket expenses over the past 12 months, including routine doctor visits, specialist visits, prescriptions and emergency room or urgent care visits.
Unless you foresee any major changes in the coming year (such as surgery, a recent diagnosis or pregnancy), past expenses are a helpful indicator for determining coverage that will be cost-effective and appropriate for you.
If your out-of-pocket expenses have been too high, search for a plan with lower deductibles. Lower deductible plans will likely mean higher monthly premiums, but the higher monthly premiums can be offset by the peace of mind from having fixed monthly medical expenses.
Tip #2: Search for Plan Options
For Medicare beneficiaries, you should receive information from the government related to your current Medicare coverage each year. Your current coverage summary is a helpful starting point in comparing options. There are many online tools for learning more, including Medicare’s Plan Finder tool or by calling 1-800-MEDICARE. You can also check the State Health Insurance Assistance Program website to find help in your state.
Below are the Medicare coverage options you can choose. One of the biggest questions is whether to choose Original Medicare (and buy a Medigap policy) or a Medicare Advantage plan (often viewed as an all-in-one alternative to Original Medicare).
- Medigap is a supplemental insurance policy designed to help cover the costs of certain medical expenses that Original Medicare doesn’t cover. A Medigap policy may cover expenses such as: Copayments, Coinsurance, Deductibles and Medical care when traveling abroad. Whether you’ve had Medigap coverage in the past or you’d find it beneficial moving forward, you can adjust, add or drop your Medigap coverage during open enrollment.
- Medicare Advantage (or Part C) is a type of healthcare plan offered by private companies contracted through Medicare. It’s designed to combine Part A (hospital insurance) and Part B (medical insurance) and in some instances it offers a prescription drug plan or other additional coverage. Medigap policies cannot work with a Medicare Advantage Plan. If you sign up for Medicare Advantage and aren’t happy with it, you can switch back to original Medicare during the first year in a Medicare Advantage plan. If you don’t drop your Medicare Advantage plan and return to Original Medicare within the first 12 months (36 months in Maine), you generally must keep your Medicare Advantage Plan for the rest of the year, disenrolling or changing during the next Open Enrollment Period or if you qualify for a Special Enrollment Period.
- Medicare Part D (Prescription Drug Plan) is for those who have an Original Medicare plan. It’s important to check for changes to your Part D coverage every year. Prescription coverage can change yearly, and your prescription needs may change as well.
For most Marketplace participants, Healthcare.gov is your starting point.
- For Maine residents, the state-based marketplace can be found at Coverme.gov
- For Massachusetts residents, the state-based marketplace can be found at MAHealthconnector.org
Tip #3: Account for Your Current Providers and MedicationsSome plans require you to visit in-network providers or offer lower out-of-pocket costs for visiting an in-network specialist. If you already have preferred providers on your current plan, switching plans could jeopardize your ability to visit them in the future.
When comparing plans, make sure to check whether or not your current healthcare providers are in-network. If they are, you should have no problem continuing to see them as you did before. If they’re out-of-network, you’ll either have to find a new provider or prepare to pay more for every visit. Also be sure that your existing medications are covered. Some plans may require generic versions of your medications, and some medications like chemotherapy drugs may not be covered at all.
We hope the above helps clarify decisions related to Medicare or ACA open enrollment. Links to additional Medicare resources can be found below. Please know your Charter Oak advisors are available to help guide you through these important decisions. It is a pleasure and a privilege to serve you, and we wish you a peaceful and relaxing Thanksgiving holiday.
- U.S.: Medicare & You 2023, The official U.S. government Medicare handbook
- Maine: State of Maine Consumer’s Guide to Medicare Supplement Insurance
- New Hampshire: New Hampshire’s Guide to Medicare Supplement Insurance
- Massachusetts: Massachusetts Consumer’s Guide to Medicare
- Other States: State Health Insurance Assistance Program